Should I Buy It?
A praxis skill is inelastic by definition — its value depends precisely on the fact that no agent can reproduce it identically. A codifiable poiesis skill is elastic — as soon as a model does the same thing more cheaply, demand for the human version disappears. Skills obey the same laws as prices.
Origin
Alfred Marshall formalized the concept of price elasticity in 1890 in Principles of Economics. The idea is simple: measure how much demand for a good responds to a change in its price.
Price elasticity = % change in demand / % change in price
- Elastic (> 1): a 10% price increase causes more than a 10% drop in demand. Consumers seek substitutes.
- Inelastic (< 1): a 10% price increase causes only a 5% drop in demand. Consumers keep buying despite the price.
- Perfectly inelastic (= 0): demand doesn’t change at all. Insulin for a diabetic is the extreme example.
Application to human skills facing AI
The labor market obeys the same laws as goods markets. A skill is inelastic when no functional substitute exists — when its value is inseparable from who performs it. A skill is elastic when it can be reproduced by another agent (human or AI) at lower cost.
| Skill type | Elasticity | Example |
|---|---|---|
| Relational praxis | Inelastic | Announcing a diagnosis to a family |
| Judgment under uncertainty | Inelastic | Deciding a strategy without a pre-established rule |
| Codifiable writing | Elastic | Standard report, meeting summary |
| Information research | Elastic | Junior legal research |
The boundary isn’t fixed — it shifts with each technological rupture. What was inelastic in 2020 may become elastic in 2025.
The oil case
Oil is the canonical example of short-term inelasticity. Modern economies can’t quickly reduce consumption even if prices explode. Consequence: a 2% reduction in global supply can trigger a 20-30% price increase. This isn’t an anomaly — it’s a mathematical property of inelasticity.
Sources
- Marshall, A. (1890). Principles of Economics. Macmillan
- Frey, C.B. & Osborne, M.A. (2013). The Future of Employment. Oxford Martin School